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JULY, 1898 


M. G. DE Lapouge recently said, " Anthropology is 
destined to revolutionize the political and the social 
sciences as radically as bacteriology has revolutionized 
the science of medicine." * In so far as he speaks of 
economics, the eminent anthropologist is not alone in his 
conviction that the science stands in need of rehabilita- 
tion. His words convey a rebuke and an admonition, and 
in both respects he speaks the sense of many scientists in 
his own and related lines of inquiry. It may be taken as 
the consensus of those men who are doing the serious 
work of modern anthropology, ethnology, and psychology, 
as well as of those in the biological sciences proper, that 
economics is helplessly behind the times, and unable to 
handle its subject-matter in a way to entitle it to standing 
as a modern science. The other political and social sci- 

* " Tlie Fundamental Laws of Antliropo-soeiology," Journal of Poliliral 
Economii, December, ISilT, p. 54. The same paper, in substance, appears in 
the liii'ista Italiana di Sociologia for November, 1S97. 


eiices come in for tlieir share of tins oblocjuy, and perliap.s 
on e([ually cogent gronnds. Kor are the ecttnomists them- 
selves buoyantly indifferent to the rebuke. Probably no 
economist to-day has either the hardihood or the inclina- 
tion to say that the science has now reached a derinitive 
formulation, either in the detail of results or as regards 
the fundamental features of theory. Tlse nearest recent 
approach to such a [xisitiou on the part of an economist of 
accredited standing is perhaps to be found in Professor 
Marshall's Cambridge address of a year and a half ago.* 
But these utterances are so far from the jaunty confidence 
shown by the classical economists of half a century ago 
that what most forcil)ly strikes the reader of Professor 
^Marshall's address is the exceeding modesty and the i\n- 
callcd-for liumility of the spokesman for the ""old genera- 
tion." With the economists who are most attentively 
looked to for guidance, uncertainty as to the definitive 
value of what has been and is being done, and as to what 
we may, with effect, take to next, is so common as to sug- 
gest that indecision is a meritorious work. Even the His- 
torical School, Avho made their innovation with so much 
of home-grown applause some time back, have been un- 
able to settle down contentedly to the pace which they set 

The men of the sciences that are jiroud to own them- 
selves "modern" find fault with the economists f(n' being 
still content to occupy themselves witli repairing a struct- 
ure and doctrines and maxims resting on natural rights, 
utilitarianism, and administrative expediency. This asper- 
sion is not altogether merited, but is near enoitgh to t!ie 
mark to carry a sting. These modern sciences are evolu- 
tionary sciences, and their adevits contemplate that charac- 
teristic of their work with some complacency. Economics 
is not an evolutionary science — by the confession of its 

""The Old Generation of Eeononiibts and the New," in this Journal tor 
January. ISUT, p. V>'o. 


Spokesman : and the economists turn their eyes with some- 
thing of envy and some sense of batUed emuLation to 
tliese rivals that make broad their phylacteries with the 
leg-end, " Up to date." 

I'recisely wherein the social and political sciences, in- 
cluding economics, fall short of being evolutionary sciences, 
is not so plain. At least, it has not been satisfactorily 
pointed out by their critics. Their successful rivals in 
this matter — ^the sciences that deal with human nature 
among the rest — ^ claim as their substantial distinction 
that tliey are realistic: they deal with facts. But eco- 
nonucs, too, is realistic in this sense : it deals with facts, 
often in the most painstaking way, and latterly with an 
increasingly strenuous insistence on the sole efficacy of 
data. But this " realism "" does not make economics an 
evolutionary science. The insistence on data could 
scarcely be carried to a higher pitch than it was carried 
by the first generation of the Historical School: and yet 
no economics is farther from being an evolutionary science 
than tlie received economics of the Historical School. 
Tlie whole broad range of erudition and research that en- 
gaged the energies of that school commonly falls short of 
being science, in that, when consistent, they have con- 
tented themselves with an enumeration of data and a 
narrative account of industrial development, and have not 
presumed to offer a theory of anything or to elaborate their 
results into a consistent body of knowledge. 

Any evolutionary science, on the other hand, is a close- 
knit body of theory. It is a theorj' of a process, of an 
unfolding sequence. But here, again, economics seems to 
meet the test in a fair measure, without satisfying its crit- 
ics that its credentials are good. It must be admitted, 
(?.(/., that J. S. Mill's doctrines of production, distribution, 
and excliange, are a theory of certain economic processes, 
and that he deals in a consistent and effective fashion with 
the sequences of fact that make up his subject-matter. So, 


also, Cairnes's discussion of normal value, of the rate of 
wages, and of international trade, are excellent instances 
of a theoretical handling of economic processes of sequence 
and the orderly unfolding development of fact. But an 
attempt to cite Mill and Cairnes as exponents of an evolu- 
tionary economics will produce no better effect than per- 
plexity, and not a great deal of that. Very much of 
monetary theory might be cited to the same purpose and 
with the like effect. Something similar is true even of 
late writers who have avowed some penchant for the 
evolutionary point of view ; as, e.g., Professor Hadley, — 
to cite a work of unquestioned merit and unusual reach. 
Measurably, he keeps the word of promise to the ear ; but 
any one who may cite his Economies as having brought 
political economy into line as an evolutionary science will 
convince neither himself nor his interlocutor. Something 
to the like effect may fairly be said of the published work 
of that later English strain of economists represented by 
Professors Cunningham and Ashley, and Mr. Cannan, to 
name but a few of the more eminent figures in the group. 

Of the achievements of the classical economists, recent 
and living, the science may justly be proud ; but they fall 
short of the evolutionist's standard of adequacy, not in 
failing to offer a theory of a process or of a developmental 
relation, but through conceiving their theory in terms 
alien to the evolutionist's habits of thought. The differ- 
ence between the evolutionarj" and the pre-evolutionary 
sciences lies not in the insistence on facts. There was a 
great and fruitful activity in the natural sciences in col- 
lecting and collating facts before these sciences took on 
the character which marks them as evolutionary. Nor 
does the difference lie in the absence of efforts to formu- 
late and explain schemes of process, sequence, growtli, 
and development in the pre-evolutionar}- days. Efforts of 
this kind abounded, in number and diversity; and many 
schemes of development, of great subtlety and beaut}^. 


gained a vogaie both as theories of organic and inorganic 
development and as schemes of the life history of nations 
and societies. It will not even hold true that our elders 
overlooked the presence of cause and effect in formulating 
their theories and reducing their data to a body of knowl- 
edge. But the terms which were accepted as tlie defini- 
tive terms of knowledge were in some degree different in 
the early days from what they are now. The terms of 
tliought hi which the investigators of some two or three 
generations back definitively formulated their knowledge 
of facts, in their last analyses, were different in kind from 
the terms in which the modern evolutionist is content to 
fornndate his results. The analysis does not run back to 
the same ground, or appeal to the same standard of final- 
ity or adequacy, in the one case as in the other. 

The difference is a difference of spiritual attitude or 
jioint of view in the two contrasted generations of scien- 
tists. To put the matter in other words, it is a difference 
in the basis of valuation of the facts for the scientific pur- 
pose, or in the interest from which the facts are ajjpre- 
ciated. With the earlier as with the later generation 
tlie basis of valuation of the facts handled is, in matters of 
detail, the causal relation which is apprehended to subsist 
between them. This is true to the greatest extent for the 
natural sciences. But in their handling of the more com- 
prehensive schemes of se(|uence and relation — in their 
definitive formulation of the results — the two generations 
differ. Tlie modern scientist is unwilling to depart from 
tlie test of causal relation or quantitative sequence. 
When he asks the question. Why? he insists on an an- 
swer in terms of cause and effect. He wants to reduce 
his solution of all problems to terms of the conservation of 
energy or the persistence of Cjuantity. This is his last 
recourse. And this last recourse has in our time been 
made available for the handling of schemes of develop- 
ment and theories of a comprehensive process by the 


notion of a cumulative causation. The great deserts of 
tlie evolutionist leaders — if they have great deserts as 
leaders — lie, on the one hand, in their refusal to go back 
of the colorless sequence of phenomena and seek higher 
ground for their ultimate syntheses, and, on the other 
hand, in their having shown how this colorless impersonal 
sequence of cause and effect can be made use of for theory 
proper, by virtue of its cumulative character. 

For the earlier natural scientists, as for the classical 
economists, this ground of cause and effect is not defini- 
tive. Their sense of truth and substantiality is not satis- 
fied with a formulation of mechanical sequence. The 
ultimate term in their systematization of knowledge is a 
"natural law." This natural law is felt to exercise some 
sort of a coercive surveillance over the sequence of events, 
and to give a spiritual stability and consistence to the 
causal relation at any given juncture. To meet the high 
classical requirement, a sequence — and a developmental 
process especially — must be apprehended in terms of a 
consistent propensity tending to some spiritually legiti- 
mate end. When facts and events have been reduced to 
these terms of fundamental truth and have been made to 
square with the requirements of definitive normality, tlie 
investigator rests content. Any causal sequence which is 
apprehended to traverse the imputed propensity in events 
is a " disturbing factor." Logical congruity with the ap- 
prehended propensity is, in this view, adequate ground 
of procedure in building up a scheme of knowledge or of 
development. The objective point of the efforts of the 
scientists working under the guidance of this classical 
tradition, is to formulate knowledge in terms of absolute 
truth; and this absolute truth is a spiritual fact. It 
means a coincidence of facts with the deliverances of an 
enlightened and deliberate common sense. 

The development and the attenuation of this preconcep- 
tion of normality or of a propensity in events might be 


traced in detail from primitive animism down tlirougli the 
elaborate discipline of faith and metaphysics, overruling 
Providence, order of nature, natural rights, natural law, 
underl3-ing principles. But all that may be necessary 
here is to point out that, by descent and by psychological 
content, this constraining normality is of a spiritual kind. 
It is for the scientific purpose an imputation of spiritual 
coherence to the facts dealt with. The question of inter- 
est is how this preconception of normality has fared at the 
bauds of modern science, and how it has come to l)e super- 
seded in the intellectual primacy by the latter-day pre- 
conception of a non-spiritual sequence. This question is 
of interest because its answer may throw light on the 
question as to what chance there is for the indefinite per- 
sistence of this archaic haljit of thought in the methods 
of economic science. 

Under primitive conditions, men stand in immediate 
personal contact with the material facts of the environ- 
ment ; and the force and discretion of tlie individual in 
shaping the facts of the environment count obviously, and 
to all appearance solely, in working out the conditions of 
life. There is little of impersonal or mechanical sequence 
visible to primitive men in their every-day life ; and what 
there is of this kind in the processes of brute nature about 
tliera is in large part inexplicable and passes for inscrut- 
able. It is accepted as malignant or beneficent, and is 
construed in the terms of personality that are familiar to 
all men at first hand, — the terms known to all men by 
first-hand knowledge of their own acts. Tlie inscrutable 
movements of the seasons and of the natural forces are 
apprehended as actions guided by discretion, will power, 
or propensity looking to an end, much as human actions 
are. The processes of inanimate nature are agencies 
wliose habits of life are to be learned, and who are to be 
coerced, outwitted, circumvented, and turned to account. 


iiiucli as the beasts are. At the same time the community 
is small, and the human contact of the individual is not 
wide. Neither the industrial life nor the non-industrial 
social life forces upon men's attention the ruthless imper- 
sonal sweep of events that no man can withstand or de- 
flect, such as becomes visible in the more complex and 
comprehensive life process of the larger community of a 
later day. There is nothing decisive to hinder men's 
knowledge of facts and events being formulated in terms 
of personality — in terms of habit and propensity and will 

As time goes on and as the situation departs from 
this archaic character, — where it does depart from it, — 
the circumstances which condition men's systematization 
of facts change in such a way as to throw the impersonal 
character of the sequence of events more and more into 
the foreground. The penalties for failure to apprehend 
facts in dispassionate terms fall surer and swifter. The 
sweep of events is forced home more consistently on men's 
minds. The guiding hand of a spiritual agency or a pro- 
pensity in events becomes less readily traceable as men's 
knowledge of things grows ampler and more searching. 
In modern times, and particularly in the industrial coun- 
tries, this coercive guidance of men's habits of thought 
in the realistic direction has been especially pronounced : 
and the effect shows itself in a somewhat reluctant but 
cumulative departure from the archaic point of view. 
The departure is most visible and has gone farthest in 
those homely branches of knowledge that have to do 
immediately with modern mechanical processes, such as 
engineering designs and technological contrivances gen- 
erally. Of the sciences, those have Avandered farthest on 
this way (of integration or disintegration, according as one 
may choose to view it) that have to do with mechanical 
sequence and process ; and those have best and longest 
retained the archaic point of view intact which — like the 


moral, social, or spiritual sciences — have to do with proc- 
ess and sequence that is less tangible, less traceable by 
the use of the senses, and that therefore less immediately 
forces upon the attention the phenomenon of sequence as 
contrasted with that of propensity. 

There is no abrupt transition from the pre-e volution ary 
to the post-evolutionary standpoint. Even in those nat- 
ural sciences which deal with the processes of life and the 
evolutionary sequence of events the concept of dispassion- 
ate cumulative causation has often and effectively been 
helped out by the notion that there is in all this some 
sort of a meliorative trend that exercises a constraining 
guidance over the course of causes and effects. The faith 
in this meliorative trend as a concept useful to the science 
has gradually weakened, and it has repeatedly been disa- 
vowed ; but it can scarcely be said to have yet disappeared 
from the field. 

The process of change in the point of view, or in the 
terms of definitive formulation of knowledge, is a gradual 
one ; and all the sciences have shared, though in an un- 
equal degree, in the change that is going forward. Eco- 
nomics is not an exception to the rule, but it still shows 
too many reminiscences of the " natural " and the " nor- 
mal," of " verities " and " tendencies," of " controlling 
principles " and " disturbing causes," to be classed as an 
evolutionary science. The history of the science shows a 
long and devious course of disintegrating animism, — from 
the days of the scholastic writers, who discussed usury 
from the point of view of its relation to the divine suze- 
rainty, to the Physiocrats, who rested their case on an 
^' ordre nafurel " and a "Zoi naturelle" that decides what 
is substantially true and, in a general way, guides the 
course of events by the constraint of logical congruence. 
There has been something of a change from Adam Smith, 
whose recourse in perplexity was to the guidance of " an 
unseen hand," to ^Nlill and Cairues, who formulated the 


laws of " natural " wages and " normal " value, and the 
former of whom was so well content with his work as to 
say, " Happily, there is nothing in the laws of Value which 
remains for the present or any future writer to clear up : 
the theory of the subject is complete." * But the differ- 
ence between the earlier and the later point of view is a 
diiference of degree rather than of kind. 

The standpoint of the classical economists, in their 
higher or definitive syntheses and generalizations, may not 
inaptly be called the standpoint of ceremonial adequacy. 
The ultimate laws and principles which they formulated 
were laws of the normal or the natural, according to a pre- 
conception regarding the ends to which, in the nature of 
things, all things tend. In effect, this preconception im- 
putes to things a tendency to work out what the instructed 
common sense of the time accepts as the adequate or 
worthy end of human eifort. It is a projection of the 
accepted ideal of conduct. This ideal of conduct is made 
to serve as a canon of truth, to the extent that the inves- 
tigator contents himself with an appeal to its legitimation 
for premises that run back of the facts with which he is 
immediately dealing, for the " controlling principles " that 
are conceived intangibly to underlie the process discussed, 
and for the " tendencies " that run beyond the situation 
as it lies before him. As instances of the use of this cere- 
monial canon of knowledge may be cited the " conjectural 
history " that plays so large a part in the classical treat- 
ment of economic institutions, such as the normalized 
accounts of the beginnings of barter in the transactions of 
the putative hunter, fisherman, and boat-builder, or the 
man with the plane and the two planks, or the two men 
with the basket of apples and the basket of nuts.f Of a 
similar import is the characterization of money as "the 
great wheel of circulation " :j: or as " the medium of ex- 

* Political Economy, Book III. chap. i. 

t Marshall, Principles of Economics (2d ed.), Book V. chap. ii. p. 395, note. 

t Adam Smith, Wealth of Nations (Bohn ed.). Book II. chap. ii. p. 289. 


change." Money is here discussed in terms of the end 
wliich, " in the normal case," it should work out according 
to the given writer's ideal of economic life, rather than in 
terms of causal relation. 

With later writers especially, this terminology is no 
doubt to be commonly taken as a convenient use of meta- 
phor, in which the concept of normality and propensity to 
an end has reached an extreme attenuation. But it is pre- 
cisely in this use of figurative terms for the formulation of 
theory that the classical normality still lives its attenuated 
life in modern economics ; and it is this facile recourse to 
inscrutable figures of speech as the ultimate terms of the- 
ory that has saved the economists from being dragooned 
into the ranks of modern science. The metaphors are 
effective, both in their homiletical use and as a labor-sav- 
ing device, — more effective than their user designs them 
to be. By their use the theorist is enabled serenely to 
enjoin himself from following out an elusive train of causal 
sequence. He is also enabled, without misgivings, to con- 
struct a theory of such an institution as money or wages or 
land-ownership without descending to a consideration of 
the living items concerned, except for convenient corrobo- 
ration of his normalized scheme of symptoms. By this 
method the theory of an institution or a phase of life may 
be stated in conventionalized terms of the apparatus 
whereby life is carried on, the apparatus being invested 
with a tendency to an equilibrium at the normal, and the 
theory being a formulation of the conditions under which 
this putative equilibrium supervenes. In this way we have 
come into the usufruct of a cost-of-production theory of 
value which is pungently reminiscent of the time when 
Nature abhorred a vacuum. The ways and means and the 
mechanical structure of industry are formulated in a con- 
ventionalized nomenclature, and the observed motions of 
this mechanical apparatus are then reduced to a normalized 
scheme of relations. The scheme so arrived at is spirit- 


uiilly binding on the behavior of the phenomena contem- 
plated. With this normalized scheme as a guide, the 
permutations of a given segment of the apparatus are 
worked out according to the values assigned the several 
items and features comprised in the calculation ; and a 
ceremonially consistent formula is constructed to cover 
that much of the industrial field. This is the deductive 
method. The formula is then tested by comparison with 
observed permutations, by the polariscopic use of the 
" normal case " ; and the results arrived at are thus authen- 
ticated by induction. Features of the process that do not 
lend themselves to interpretation in the terms of the 
formula are abnormal cases and are due to disturbing 
causes. In all this the agencies or forces causally at work 
in the economic life process are neatly avoided. The out- 
come of the method, at its best, is a body of logically con- 
sistent propositions concerning the normal relations of 
things — a system of economic taxonomy. At its worst, it 
is a body of maxims for the conduct of business and a 
polemical discussion of disputed points of policy. 

In all this, economic science is living over again in its 
turn the experiences which the natural sciences passed 
through some time back. In the natural sciences the 
work of the taxonomist was and continues to be of great 
value, but the scientists grew restless under the regime of 
symmetry and system-making. They took to asking why, 
and so shifted their inquiries from the structure of the 
coral reefs to the structure and habits of life of the polyp 
that lives in and by them. In the science of plants, sys- 
tematic botany has not ceased to be of service ; but the 
stress of investigation and disctission among the botanists 
to-day falls on the biological value of any given feature of 
structure, function, or tissue rather than on its taxonomic 
bearing. All the talk about cytoplasm, centrosomes, and 
karyokinetic process, means that the inquiry now looks 
consistently to the life process, and aims to explain it in 
terms of cumulative causation. 


What may be done in economic science of the taxo- 
nomic kind is shown at its best in Cairnes's work, where 
the method is well conceived and the results effectively 
formulated and applied. Cairnes handles the theory of 
the normal case in economic life with a master hand. In 
his discussion the metaphysics of propensity and tendencies 
no longer avowedly rules the formulation of theory, nor 
is the inscrutable meliorative trend of a harmony of inter- 
ests confidently appealed to as an engine of definitive use 
in giving legitimacy to the economic situation at a given 
time. There is less of an exercise of faith in Cairnes's 
economic discussions than in those of the writers that 
went before him. The definitive terms of the formula- 
tion are still the terms of normality and natural law, but 
the metaphysics underlying this appeal to normality is so 
far removed from the ancient ground of the beneficent 
"order of nature" as to have become at least nominally 
impersonal and to proceed without a constant regard to 
the humanitarian bearing of the " tendencies " which it 
formulates. The metaphysics has been attenuated to 
something approaching in colorlessness the naturalist's 
conception of natural law. It is a natural law which, in 
the guise of " controlling principles," exercises a constrain- 
ing surveillance over the trend of things; but it is no 
longer conceived to exercise its constraint in the interest 
of certain ulterior human purposes. The element of be- 
neficence has been well-nigh eliminated, and the system is 
formulated in terms of the system itself. Economics as it 
left Cairnes's hand, so far as his theoretical work is con- 
cerned, comes near being taxonomy for taxonomy's sake. 

No equally capable writer has come as near making 
economics the ideal " dismal " science as Cairnes in his 
discussion of pure theory. In the days of the early classi- 
cal writers economics had a vital interest for the laymen 
of the time, because it formulated the common sense 
metaphysics of the time in its application to a department 


of human life. But in the hands of the later classical 
writers the science lost much of its charm in this regard. 
It was no longer a definition and authentication of the 
deliverances of current common sense as to what ought to 
come to pass ; and it, therefore, in large measure lost the 
support of the people out of doors, who were unable to 
take an interest in what did not concern them; and it 
was also out of touch with that realistic or evolutionary 
habit of mind which got under way about the middle of 
the century in the natural sciences. It was neither 
vitally metaphysical nor matter-of-fact, and it found com- 
fort with very few outside of its own ranks. Only for 
those who by the fortunate accident of birth or education 
have been able to conserve the taxonomic animus has the 
science during the last third of a century continued to be 
of absorbing interest. The result has been that from the 
time when the taxonomic structure stood forth as a com- 
pleted whole in its symmetry and stability the economists 
themselves, beginning with Cairnes, have been growing 
restive under its discipline of stability, and have made 
many efforts, more or less sustained, to galvanize it into 
movement. At the hands of the writers of the classical 
line these excursions have chiefly aimed at a more com- 
plete and comprehensive taxonomic scheme of permuta- 
tions ; while the historical departure threw away the taxo- 
nomic ideal without getting rid of the preconceptions on 
which it is based; and the later Austrian groujp struck 
out on a theory of process, but presently came to a full 
stop because the process about which they busied them- 
selves was not, in their apprehension of it, a cumulative 
or unfolding sequence. 

But what does all this signify? If we are getting rest- 
less under the taxonomy of a monocotyledonous wage 
doctrine and a cryptogamic theory of interest, with in- 
volute, loculicidal, tomentous, and moniliform variants, 


what is the cytoplasm, centrosome, or kaiyokinetic proc- 
ess to which we may turn, and in which we may find sur- 
cease from the metaphysics of normality and controlling 
principles? What are we going to do about it? The 
question is rather, What are we doing about it? There 
is the economic life process still in great measure await- 
ing theoretical formulation. The active material in which 
the economic process goes on is the human material of 
the industrial community. For the purpose of economic 
science the process of cvimulative change that is to be 
accounted for is the sequence of change in the methods 
of doing things, — the methods of dealing with the ma- 
terial means of life. 

What has been done in the way of inquiry into this 
economic life process? The ways and means of turning 
material objects and' circumstances to account lie before 
the investigator at any given point of time in the form of 
mechanical contrivances and arrangements for compassing 
certain mechanical ends. It has therefore been easy to 
accept these ways and means as items of inert matter 
having a given mechanical structure and thereby serving 
the material ends of man. As such, they have been sched- 
uled and graded by the economists under the head of 
capital, this capital being conceived as a mass of material 
objects serviceable for human use. This is well enough 
for the purposes of taxonomy ; but it is not an effective 
method of conceiving the matter for the purpose of a 
theory of the developmental process. For the latter pur- 
pose, when taken as items in a process of cumulative 
change or as items in the scheme of life, these produc- 
tive goods are facts of human knowledge, skill, and predi- 
lection ; that is to say, they are, substantially, prevalent 
habits of thought, and it is as such that they enter into 
the process of industrial development. The physical 
properties of the materials accessible to man are con- 
stants : it is the human agent that changes, — his insight 


and his appreciation of what these things can be used for 
is what develops. The accumulation of goods already on 
hand conditions his handling and utilization of the mate- 
rials offered, but even on this side — the " limitation of 
industry by capital " — the limitation imposed is on what 
men can do and on the methods of doing it. The changes 
that take place in the mechanical contrivances are an 
expression of changes in the human factor. Changes in 
the material facts breed further change only through the 
human factor. It is in the human material that the con- 
tinuity of development is to be looked for ; and it is here, 
therefore, that the motor forces of the process of economic 
development must be studied if they are to be studied in 
action at all. Economic action must be the subject-matter 
of the science if the science is to fall into line as an evo- 
lutionary science. 

Nothing new has been said in all this. But the fact is 
all the more significant for being a familiar fact. It is a 
fact recognized by common consent throughout much of 
the later economic discussion, and this current recognition 
of the fact is a long step towards centering discussion and 
inquiry upon it. If economics is to follow the lead or 
the analogy of the other sciences that have to do with a 
life process, the way is plain so far as regards the general 
direction in which the move will be made. 

The economists of the classical trend have made no seri- 
ous attempt to depart from the standpoint of taxonomy 
and make their science a genetic account of the economic 
life process. As has just been said, much the same is true 
for the Historical School. The latter have attempted an 
account of developmental sequence, but they have fol- 
lowed the lines of pre-Darwinian speculations on devel- 
opment rather than lines which modern science would 
recognize as evolutionary. They have given a narrative 
survey of phenomena, not a genetic account of an unfold- 
ing process. In this work they have, no doubt, achieved 


results of permanent value; but the results achieved are 
scarcely to be classed as economic theory. On the other 
hand, the Austrians and their precursors and their coadju- 
tors in the value discussion have taken up a detached 
portion of economic theory, and have inquired with great 
nicety into the process by which the phenomena within 
their limited field are worked out. The entire discussion 
of marginal utility and subjective value as the outcome of 
a valuation process must be taken as a genetic study of 
this range of facts. But here, again, nothing further has 
come of the inquiry, so far as regards a rehabilitation of 
economic theory as a whole. Accepting Menger as their 
spokesman on this head, it must be said that the Austrians 
have on the whole showed themselves unable to break 
with the classical tradition that economics is a taxonomic 

The reason for the Austrian failure seems to lie in a 
faulty conception of human nature, — faulty for the present 
purpose, however adequate it may be for any other. In 
all the received formulations of economic theory, whether 
at the hands of English economists or those of the Conti- 
nent, the human material with which the inquiry is con- 
cerned is conceived in hedonistic terms ; that is to say, in 
terms of a passive and substantially inert and immutably 
given human nature. The psychological and anthropo- 
logical preconceptions of the economists have been those 
which were accepted by the psychological and social 
sciences some generations ago. The hedonistic concep- 
tion of man is that of a lightning calculator of pleas- 
ures and pains, who oscillates like a homogeneous glob- 
ule of desire of happiness under the impulse of stimuli 
that shift him about the area, but leave him intact. He 
has neither antecedent nor consequent. He is an isolated, 
definitive human datum, in stable equilibrium except for 
the buffets of the impinging forces that displace him in 
one direction or another. Self-poised in elemental space. 


he spins symmetrically about his own spiritual axis until 
the parallelogram of forces bears down upon him, where- 
upon he follows the line of the resultant. When the 
force of the impact is spent, he comes to rest, a self- 
contained globule of desire as before. Spiritually, the 
hedonistic man is not a prime mover. He is not the seat 
of a process of living, except in the sense that he is sub- 
ject to a series of permutations enforced upon him by 
circumstances external and alien to him. 

The later psychology, re-enforced by modern anthropo- 
logical research, gives a different conception of human 
nature. According to this conception, it is the character- 
istic of man to do something, not simply to suffer pleas- 
ures and pains through the impact of suitable forces. He 
is not simply a bundle of desires that are to be saturated 
by being placed in the path of the forces of the environ- 
ment, but rather a coherent structure of propensities and 
habits which seeks realization and expression in an unfold- 
ing activity. According to this view, human activity, 
and economic activity among the rest, is not apprehended 
as something incidental to the process of saturating given 
desires. The activity is itself the substantial fact of the 
process, and the desires under whose guidance the action 
takes place are circumstances of temperament which de- 
termine the specific direction in which the activity will 
unfold itself in the given case. These circumstances of 
temperament are ultimate and definitive for the individual 
who acts under them, so far as regards his attitude as 
agent in the particular action in which he is engaged. 
But, in the view of the science, they are elements of the 
existing frame of mind of the agent, and are the outcome 
of his antecedents and his life up to the point at which he 
stands. They are the products of his hereditary traits 
and his past experience, cumulatively wrought out under 
a given body of traditions, conventionalities, and material 
circumstances ; and they afford the point of departure for 


the next step in the process. The economic life liistory 
of the individual is a cumulative process of adaptation of 
means to ends that cumulatively change as the process 
goes on, both the agent and his environment being at any 
point the outcome of the past process. His methods of 
life to-day are enforced upon him by his habits of life 
carried over from yesterday and by the circumstances left 
as the mechanical residue of the life of yesterday. 

What is true of the individual in this respect is true 
of the group in which he lives. All economic change is 
a change in the economic community, — a change in the 
community's methods of turning material things to ac- 
count. The change is always in the last resort a change 
in habits of thought. This is true even of changes in the 
mechanical processes of industry. A given contrivance 
for effecting certain material ends becomes a circumstance 
which affects the further growth of habits of thought — 
habitual methods of procedure — and so becomes a point 
of departure for further development of the methods of 
compassing the ends sought and for the further variation 
of ends that are sought to be compassed. In all this flux 
there is no definitively adequate method of life and no de- 
finitive or absolutely worthy end of action, so far as 
concerns the science which sets out to formulate a theory 
of the process of economic life. What remains as a hard 
and fast residue is the fact of activity directed to an ob- 
jective end. Economic action is teleological, in the sense 
that men always and everywhere seek to do something. 
What, in specific detail, they seek, is not to be answered 
except by a scrutin}^ of the details of their activity ; but, 
so long as we have to do with their life as members of the 
economic community, there remains the generic fact that 
their life is an unfolding activity of a teleological kind. 

It may or may not be a teleological process in the sense 
that it tends or should tend to any end that is conceived 
to be worthy or adequate by the inquirer or by the con- 


sensus of inquirers. Whether it is or is not is a question 
with which tlie present inquiry is not concerned ; and it is 
also a question of which an evolutionary economics need 
take no account. The question of a tendency in events 
can evidently not come up except on the ground of some 
preconception or prepossession on the part of the person 
looking for the tendency. In order to search for a ten- 
dency, we must be possessed of some notion of a definitive 
end to be sought, or some notion as to what is the legit- 
imate trend of events. The notion of a legitimate trend 
in a course of events is an extra-evolutionary preconcep- 
tion, and lies outside the scope of an inquiry into the 
causal sequence in any process. The evolutionary point 
of view, therefore, leaves no place for a formulation of 
natural laws in terms of definitive normality, whether in 
economics or in any other branch of inquiry. Neither 
does it leave room for that other question of normality. 
What should be the end of the developmental process 
under discussion ? 

The economic life history of any community is its life 
history in so far as it is shaped by men's interest in the 
material means of life. This economic interest has counted 
for much in shaping the cultural growth of all communi- 
ties. Primarily and most obviously, it has guided the 
formation, the cumulative growth, of that range of con- 
ventionalities and methods of life that are currently recog- 
nized as economic institutions ; but the same interest has 
also pervaded the community's life and its cultural growth 
at points where the resulting structural features are not 
chiefly and most immediately of an economic bearing. 
The economic interest goes with men through life, and it 
goes with the race throughout its process of cultural de- 
velopment. It affects the cultural structure at all points, 
so that all institutions may be said to be in some measure 
economic institutions. This is necessarily the case, since 
the base of action — the point of departure — at any step 


in the process is the entire organic complex of habits of 
thought that have been shaped by the past process. The 
economic interest does not act in isolation, for it is but one 
of several vaguely isolable interests on which the complex 
of teleological activity carried out by the individual pro- 
ceeds. The individual is but a single agent in each case ; 
and he enters into each successive action as a whole, 
although the specific end sought in a given action may be 
sought avowedly on the basis of a particular interest ; as 
e.g., the economic, Eesthetic, sexual, humanitarian, devo- 
tional interests. Since each of these passably isolable 
interests is a propensity of the organic agent man, with 
his complex of habits of thought, the expression of each is 
affected by habits of life formed under the guidance of all 
the rest. There is, therefore, no neatly isolable range of 
cultural phenomena that can be rigorously set apart under 
the head of economic institutions, although a category of 
" economic institutions " may be of service as a convenient 
caption, comprising those institutions in which the eco- 
nomic interest most immediately and consistently finds 
expression, and which most immediately and with the 
least limitation are of an economic bearing. 

From what has been said it appears that an evolutionary 
economics must be the theory of a process of cultural 
growth as determined by the economic interest, a theory 
of a cumulative sequence of economic institutions stated 
in terms of the process itself. Except for the want of 
space to do here what should be done in some detail if it 
is done at all, many efforts by the later economists in this 
direction might be cited to show the trend of economic 
discussion in this direction. There is not a little evidence 
to this effect, and much of the work done must be rated 
as effective work for this purpose. Much of the work of 
the Historical School, for instance, and that of its later 
exponents especially, is too noteworthy to be passed over 
in silence, even with all due regard to the limitations of 


We are now ready to return to the question why eco- 
nomics is not an evolutionary science. It is necessarily 
the aim of such an economics to trace the cumulative 
working out of the economic interest in the cultural 
sequence. It must be a theory of the economic life proc- 
ess of the race or the community. The economists have 
accepted the hedonistic preconceptions concerning human 
nature and human action, and the conception of the eco- 
nomic interest which a hedonistic psychology gives does 
not afford material for a theory of the development of 
human nature. Under hedonism the economic interest is 
not conceived in terms of action. It is therefore not read- 
ily apprehended or appreciated in terms of a cumulative 
growth of habits of thought, and does not provoke, even 
if it did lend itself to, treatment by the evolutionary 
method. At the same time the anthropological precon- 
ceptions current in that common-sense apprehension of 
human nature to which economists have habitually turned 
has not enforced the formulation of human nature in 
terms of a cumulative growth of habits of life. These 
received anthropological preconceptions are such as have 
made possible the normalized conjectural accounts of 
primitive barter with which all economic readers are 
familiar, and the no less normalized conventional deriva- 
tion of landed property and its rent, or the sociologico- 
philosophical discussions of the " function " of this or that 
class in the life of society or of the nation. 

The premises and the point of view required for an evo- 
lutionary economics have been wanting. The economists 
have not had the materials for such a science ready to 
their hand, and the provocation to strike out in such a 
direction has been absent. Even if it has been possible at 
any time to turn to the evolutionary line of speculation 
in economics, the possibility of a departure is not enough 
to bring it about. So long as the habitual view taken of 
a given range of facts is of the taxonomic kind and the 


material lends itself to treatment by that method, the tax- 
onomic method is the easiest, gives the most gratifying 
immediate results, and best fits into the accepted body of 
knowledge of the range of facts in question. This has 
been the situation in economics. The other sciences of 
its group have likewise been a body of taxonomic dis- 
cipline, and departures from the accredited method have 
lain under the odium of being meretricious innovations. 
The well-worn paths are easy to follow and lead into good 
company. Advance along them visibly furthers the ac- 
credited work which the science has in hand. Divergence 
from the paths means tentative work, which is necessarily 
slow and fragmentary and of uncertain value. 

It is only when the methods of the science and the syn- 
theses resulting from their use come to be out of line with 
habits of thought that prevail in other matters that the 
scientist grows restive under the guidance of the received 
methods and standpoints, and seeks a way out. Like other 
men, the economist is an individual with but one intelli- 
gence. He is a creature of habits and propensities given 
through the antecedents, hereditary and cultural, of which 
he is an outcome ; and the habits of thought formed in any 
one line of experience affect his thinking in any other. 
Methods of observation and of handling facts that are 
familiar through habitual use in the general range of knowl- 
edge, gradually assert themselves in any given special 
range of knowledge. They may be accepted slowly and 
with reluctance where their acceptance involves innova- 
tion ; but, if they have the continued backing of the gen- 
eral body of experience, it is only a question of time when 
they shall come into dominance in the special field. The 
intellectual attitude and the method of correlation en- 
forced upon us in the apprehension and assimilation of 
facts in the more elementary ranges of knowledge that 
have to do with brute facts assert themselves also when 
the attention is directed to those phenomena of the life 


process with which economics has to do ; and the range 
of facts which are habitually handled by other methods 
than that in traditional vogue in economics has now be- 
come so large and so insistently present at every turn that 
we are left restless, if the new body of facts cannot be 
handled according to the method of mental procedure 
which is in this way becoming habitual. 

In the general body of knowledge in modern times the 
facts are apprehended in terms of causal sequence. This 
is especially true of that knowledge of brute facts which 
is shaped by the exigencies of the modern mechanical in- 
dustry. To men thoroughly imbued with this matter-of- 
fact habit of mind the laws and theorems of economics, 
and of the other sciences that treat of the normal course 
of things, have a character of " unreality " and futility 
that bars out any serious interest in their discussion. 
The laws and theorems are " unreal " to them because they 
are not to be apprehended in the terms which these men 
make use of in handling the facts with which they are 
perforce habitually occupied. The same matter-of-fact 
spiritual attitude and mode of procedure have now made 
their way well up into the higher levels of scientific knowl- 
edge, even in the sciences which deal in a more elemen- 
tary way with the same human material that makes the 
subject-matter of economics, and the economists them- 
selves are beginning to feel the unreality of their theorems 
about " normal " cases. Provided the practical exigencies 
of modern industrial life continue of the same character as 
they now are, and so continue to enforce the impersonal 
method of knowledge, it is only a question of time when 
that (substantially animistic) habit of mind which pro- 
ceeds on the notion of a definitive normality shall be dis- 
placed in the field of economic inquiry by that (substan- 
tially materialistic) habit of mind Avhich seeks a compre- 
hension of facts in terms of a cumulative sequence. 

The later method of apprehending and assimilating 


facts and handling them . for the purposes of knowledge 
may be better or worse, more or less worthy or adequate, 
than the earlier ; it may be of greater or less ceremonial or 
sesthetic effect ; we may be moved to regret the incursion 
of underbred habits of thought into the scholar's domain. 
But all that is beside the present point. Under the stress 
of modern technological exigencies, men's every-day habits 
of thought are falling into the lines that in the sciences 
constitute the evolutionary method ; and knowledge which 
proceeds on a higher, more archaic plane is becoming 
alien and meaningless to them. The social and political 
sciences must follow the drift, for they are already caught 
in it. 

University of Chicago.